Wednesday, November 9, 2011

Oil going to $200 a barrel on Iran concerns?

QUOTE: In the first hours of the attack prices would surge, on average, by $23 a barrel, according to the survey. Under the worst case scenario, including the closure of the Strait of Hormuz, prices could increase, on average, by $61 a barrel, lifting Brent crude to an all-time high of $175 a barrel. Some traders warned that the increase could be much bigger, pushing oil prices up by $175 a barrel to a dizzying $290 a barrel.

It wouldn't be that big of a surprise to see it go to that higher number of $290 a barrel the way things are going these days...

Other factors to keep in mind:

QUOTE #2: The supply glitches continue to plague the market. Although Libya’s oil output has recovered to about 550,000 b/d, it remains well below the prewar level of 1.6m b/d. At the same time, oil production in Yemen and Syria has dropped by a combined 200,000 b/d due to unrest in both countries. In addition, production is running below the expected level in the North Sea, Nigeria and Azerbaijan.

Definitely worth keeping your gas tank topped off, correct? And if you have a way to store some extra fuel in a safe way (gas cans or holding tanks specifically designed for that purpose) it might not be a bad idea to do so as well.